The Sunday Post - Playing out to Accorging to Plan
The Sunday Post – Playing out according to Plan
I haven’t posted a Sunday Post in quite some time, as the PLS story is unfolding in a very predictable fashion, in the very unpredictable exploration business. No major changes in a positive or negative way as to the deposit. Just the steady positive flow and building out of the deposit towards most expected estimates, that any retail, expert, or institutional investor expected that has done a good amount of DD. With the first holes coming in from the winter drill program, some interesting things are forming though, in a positive way.
Main Strike Deposit
The first holes have been reported, and from the results, it looks like R390E and R585E pods could be joined, along with R780E and R945E first, creating 2 large zones, before the possibility of many/all joining together. The most significant to me was hole 131 which was a huge step out south with such strong scint readings along with long intercepts in zone R780E. Deposits throughout the basin in history tend to be in thin long pods along strike. Raymond James’s recent report has some good reading geologically on this area. He continues to be my favourite pro analyst with reports, as he adds good substance, reference to maps from company available data, historic basin data, and reasonable evaluations.
Currently R390E has the largest concentration so far, but R780E is shaping up to overtake it in the meat of the strike. When looking at the corebox 3D visualization of the deposit, you really see how much larger the intercepts are from R945 to R585, compared to R390 through R00. Now with a North-South width of 70 meters possible, it only adds to my thesis the R780E will be the centre, and most resource adding area. These types of uranium pods in the basin are very irregular, and it’s still too early to say how the North-South width expands throughout the zone. I find it exiting none the less to see this unique deposit take shape and play out. Although risks in every deposit this still continues to be the least risky with still great upside in the exploration business and the best early exploration uranium play in the world. I still hold with my 80-100 million pounds to be proved up with current funding in the treasury.
Speculation Upside
On the speculation side, I am most excited about the possibility of that final rig exploring the other EM conductors on the property finds something. With the latest radon survey areas identified, 3 on Paterson Lake, and one very large area on Forest Lake, you know where they are looking. Any significant find on any of these conductors would be huge. It would also drive massive speculation, both rational and irrational. The Forest Lake area is very large and more of a virgin exploration area. The areas A and C, I find most promising as they are still east of the boulder field. These areas have already had previous holes drilled without success, but are limited in nature. When you look at the total distance between holes drilled, the nature of how pods exist in the basin and the area, there very well could be other high grade zones on these conductors. Also by referencing the previous surveys, you will see some nice readings, in several areas, giving good data for finds.
Trading
FCU continues to be among the highest traded companies on Venture, with the last day on Friday trading almost 4 million shares across the various exchanges. The fact that it continues to trade such high volumes only shows the interest in this company and deposit, with no compliant resource estimate announced yet. The interest is spread across trading it, manipulating it, accumulating it, and anything else you can think of as far as I am concerned. All these things are out of my control and therefore don’t stress over it, I will wait for the sale, whenever it comes, will make a ROI, just how large remains to be seen. I only look at my deposit valuation compared to current price, and whether to add or trim depending on the circumstance, never leaving a core position. The fact is that since the merger and spinout occurred on Dec 9th, it's up around 25% if you still owned both, and cared about the daily price. I personally loaded up before the merger (too high), and trimmed back to my previous levels in the New Year. If for some reason it got sold down significantly, it would make me happy, and I would load up again.
News Flow
You will see no significant downturn in news flow with this company throughout the entire year, which in turn keeps it in the spot light. The size of the drill programs, reporting the scints, then the assays, guarantees constant updates this year, then the maiden resource estimate. I also am hoping that drilling goes better than expected this winter, and the program is expanded further because of the lower costs compared to summer.
Uranium Price and Leverage
As stated in previous posts, the price is simply supply and demand. The glut is being worked through, though the actual timing is unknown. There is no shortage of “experts” or “predictions” on this time frame. The one thing that will happen is it will be worked out sooner or later. I believe not all reactors will come back in Japan, but many will, and a lot are new ones are coming on board over the next decade in various countries. There is plenty of factual data out there on that, and easy to find. The price of uranium at the time of a buyout of Fission will affect the price, so the longer it stays on the market the more it will be worth. Either way this does put pressure on a buyout, because if there is any deposit that’s economical at any price, PLS is it. If you look at the mining economics in any commodity this deposit is extremely attractive, not to mention the strategic location on the west side of the basin and how it increases its value. A higher uranium price just adds leverage to this. It’s going to take someone to make a bid to start the process. Some may just wait until someone else fires the first shot. When it happens though, there will be other bids in my opinion, how many, it remains to be seen. My best guess is after the first compliant resource estimate, but no one knows, except the entities putting in a bid.
As always I am pulling for the retail investor who has the guts, knowledge, and a good plan to invest in this sector..
Find an high grade unique deposit… in a future rising price commodity environment… do your homework… block out the noise… and make some money…
Those of you on a long weekend hope it continues to be a good one, those not, hope it was a good one!
Cheers
Presclubs
(Disclosure: I hold a long position in FCU. I am not a broker, professional analyst, or work for a financial intuition. I am a retail investor. I do not receive commissions or compensation for posting. I have a group of friends who also are invested, and post on this site for their benefit and any other retail investors that find it relevant. It’s a hobby, enjoy it, and invest in this stock because of my belief of large potential returns with low risks. These are my personal opinions; investors should do their own due diligence on what to invest in. Team PLS 1.37m)